AEO Registrations

The Authorized Economic Operator (AEO) program is a worldwide effort to improve international trade & supply chain security. AEO helps businesses involved in cross-border trade earn a certification that shows their dedication to customs rules, safety standards, and fair trade practices. The AEO (Authorized Economic Operator) program is key in making customs processes easier, lowering trade barriers, & supporting the safe and smooth movement of goods in global trade. For all of this, you are required to apply for AEO registration. Here at SKMC Global, we are here to help you.

WCO (World Customs Organization) is key in shaping and supporting AEO programs globally. It offers guidelines & standards to help countries set up AEO programs while encouraging cooperation between customs authorities. The WCO's advice enables nations to customize their AEO programs based on international best practices, ensuring smooth & consistent global trade.

AEO programs were launched worldwide to help businesses involved in international trade by making customs processes simpler, lowering trade risks, and improving supply chain security & efficiency. In India, the AEO program was introduced to match global standards, giving businesses a chance to earn AEO certification, showing their dedication to customs compliance & trade security.

Eligibility Criteria for AEO Registration

1. Establishing a business in a nation recognized by the AEO is encouraged.
2. The company should engage in import/export activities relating to customs. 
3. The business in question ought to have been operational for the previous three fiscal years. 
4. Have processed a minimum of 25 customs documents in the previous fiscal years, including shipping bills and bills of entry. 
5. For three years in a row, the company's accounts and records must be clear and unblemished, and no show cause notices for fraud, forgery, or other unlawful activity should have been issued in the previous three years. 

Required Documents for AEO Registration

1. Company registered documents 
2. Import and Export code details 
3. GST certificate 
4. Financial statements for the last 3 years 
5. Details of customs filing for past 3 years 
6. Process flow chart depicting the company import/export operations. 
7. Samples of the company record-keeping documentation (sales/purchase orders, inventory management)

How to Apply for AEO Registration in India

In India, the process for applying for AEO certification is managed by the Central Board of Indirect Taxes and Customs (CBIC) and can be completed online.

Steps to apply for AEO registration online:

Step 1: Registration on AEO portal

1. The application is available in the AEO India portal 
2. The relevant information about the company, including its name, IEC number, business type, and contact details, must be entered. 

Step 2: Login and Application Submission 

1. Log in to the portal using the credentials created during the AEO registration. 
2. Choose the relevant AEO certification type (T1, T2, T3, or LO).
3. Provide thorough details about the business's operations, compliance record, and security measures on the online application form. 

Step 3: Documentation (List of Annexure) 

These are the documents that usually consist of:

1. Evidence of financial stability 
2. Records of compliance with tax and customs laws 
3. Procedures and security measures 
4. Organizational structure and managerial information
5. Any additional documentation that the CBIC specifies.

Step 4: Self-Assessment Questionnaire

1. Fill out the AEO self-assessment form to help examine your security and compliance requirements. 
2. This survey evaluates how well your business follows AEO standards and principles. 

Step 5: Verification and Audit

1. The AEO program team reviews the application after it is submitted. 
2. To confirm the information submitted in the application and to make sure the AEO requirements are being followed, an on-site audit may be carried out. 

Step 6: Approval and certification

1. The AEO certificate is granted if the application and audit are approved. 
2. The AEO portal offers a download link for the certificate.

Types of AEO Certification

The AEO program in India is designed to fit businesses of all sizes and compliance levels, with different stages offering unique benefits. Each level requires a certain commitment to security & customs rules. By choosing the right level, companies can reduce costs, boost efficiency & gain a competitive advantage in global trade.

The Authorized Economic Operator (AEO) program in India offers several stages to enterprises, each with differing requirements and rewards. These all AEO tiers are designed to fit businesses of all types and sizes, from small startups to large global companies. They show the level of security & compliance a business has in place.

AEO-T1 (Tier 1):

This is the entry-level certification. It requires less documentation and focuses on the company's self-evaluation. Benefits include a reduced selection rate for a physical inspection by customs and quicker shipping clearance.

Benefits of AEO T1

1. Reduced physical and document-based controls.
2. Simplified customs procedures.
3. Priority treatment in case of physical inspection.
4. Deferred payment of duties

AEO-T2 (Tier 2):

At this level, customs officers conduct a more thorough evaluation and visit the company location to confirm the company procedures and record-keeping. Compared to T1, AEO-T2 certification has more advantages, like delayed customs duty payment and expedited clearance procedures.

Benefits of AEO T2

1. All benefits of AEO-T1.
2. Reduced bank guarantees.
3. Faster clearance times.
4. Mutual recognition agreements with other countries' AEO programs.
5. Fewer physical inspections and document checks

AEO-T3 (Tier 3):

For importers and exporters, this is the highest level of AEO accreditation available. It needs a track record of successfully adhering to customs laws and strong security protocols throughout the company supply chain. The largest advantages accrue to AEO-T3 holders, who also benefit from priority clearance and less physical inspection of shipments, which expedites the flow of products through customs.

Benefits of AEO T3

1. All benefits of AEO-T1 and AEO-T2.
2. Maximum facilitation at customs points.
3. Fast-tracking of shipments through customs.
4. Priority access to new customs initiatives and programs.
5. Comprehensive mutual recognition arrangements with international customs authorities.

AEO-LO (Logistics Operator)

For organizations engaged in logistics-related activities like freight forwarding, customs brokerage, and warehousing, this is a one-tier accreditation. Benefits of AEO-LO certification include expedited clearance of shipments they handle on behalf of clients and streamlined procedures for handling cargo.

Benefits of AEO-LO

1. Reduced customs controls and inspections.
2. Faster customs clearance for logistics operations.
3. Enhanced reputation and trust with clients and partners.
4. Inclusion in the AEO mutual recognition agreements, benefiting from streamlined
5. Procedures internationally.

An Overview of All Types of AEO Certification

AEO registration process for each AEO tier 

1. When applying for an Authorized Economic Operator (AEO) certificate, a company must self-assess to determine which tier is best for it based on its security and compliance procedures.
2. Records relating to the security policy, financial accounts over the last three years, and compliance. 
3. Once all the necessary paperwork has been obtained, the application must be submitted and uploaded to the CBIC website. 
4. The customs authority will conduct an on-site inspection of the locations listed in the application if needed. 
5. The AEO registration for the relevant tier is awarded upon the successful conclusion of the evaluation and audit.
6. The customs authorities will give the company AEO certification once the review and audit procedures have been successfully completed. AEO registration or certificates are typically valid for a set amount of time (three years, for example), after which the company might have to go through a renewal process.

Benefits of AEO Registration

AEO registration offers numerous benefits to businesses and individuals participating in the international supply chain. Some of the key advantages include:

• Expedited Customs Clearance: AEOs enjoy faster and priority customs clearance, reducing delays in the movement of goods.
• Reduced Physical Inspections: AEO status leads to fewer physical inspections, lowering the risk of supply chain disruptions.
• Enhanced Security: AEO certification signifies a commitment to security standards, enhancing the safety and integrity of the supply chain.
• Lower Compliance Risks: AEOs are less likely to face customs compliance issues, reducing the risk of penalties and delays.
• Global Recognition: AEO status is recognized globally, facilitating trade with partner countries.
• Improved Relations with Customs Authorities: AEOs have better relationships with customs authorities, ensuring smoother interactions.
• Competitive Advantage: AEO certification sets businesses apart in the market, signaling reliability and trustworthiness.
• Supply Chain Optimization: AEO status enables businesses to streamline their supply chain operations, reducing costs and improving efficiency.

How SKMC Global Can Help?

1. Expert Consultation: Our team provides clear guidance & support throughout the AEO registration process, helping your business understand the eligibility requirements & benefits of AEO status.
2. Efficient Application Preparation: SKMC Global assists in preparing and submitting AEO applications, ensuring that all necessary documentation is accurate and complete.
3. Compliance Assessment: We conduct a thorough assessment of your business's customs compliance to identify and address any potential issues before the application process, increasing your chances of successful AEO registration.
4. Mutual Recognition Agreements (MRAs): SKMC Global can facilitate the establishment of Mutual Recognition Agreements (MRAs) for your business, extending the benefits of AEO status to partner countries and expanding your global trade facilitation.
5. Customized Solutions: We tailor our services to your specific needs, whether you are a manufacturer, importer, exporter, customs broker, or logistics provider, ensuring that your AEO application is relevant to your trade activities.
6. Supply Chain Optimization: AEO status helps make your supply chain more efficient. Our AEO consultant guide you on improving your international trade, cutting costs, & boosting overall efficiency.
7. Competitive Advantage: SKMC Global ensures that your AEO certification sets you apart in the market, signaling trustworthiness and reliability to your clients and partners.
8. Ongoing Support: Our services extend beyond AEO registration. We offer continuous support, keeping your business informed about AEO rule changes & helping you stay compliant with customs authorities.